Israel’s Cabinet unanimously approved a proposal to moderate cuts to the defense budget as part of sweeping austerity measures.
The Cabinet opened its 2013-14 budget talks on Monday with discussions on defense.
Following a meeting of the security Cabinet that lasted much of Sunday, Treasury Minister Yair Lapid agreed to a reduction in the defense budget of 3 billion shekels, or $840 million, with another 1 billion shekels, or $280 million, coming from the defense budget reserves. Lapid originally had proposed cutting 4 billion shekels, or about $1.1 billion.
“We need the IDF to continue becoming more efficient, but we also need additional Iron Dome batteries, and I believe that the path I am proposing today strikes a proper balance between the needs of the economy and security needs,” Prime Minister Benjamin Netanyahu, who brokered the compromise, said at the start of the weekly Cabinet meeting.
Austerity measures include a reduction in the child allowance and raising taxes, including a 1.5 percent hike on income and a 1 percent rise in the value added tax to 18 percent. The fiscal plan must be passed by Aug. 1.
The Cabinet is expected to approve the entire budget late Monday.